Big Banks Are Committing Major Crimes Against the Climate

At the start of next week, the United Nations Framework Convention on Climate Change, the U.N.'s negotiating body on climate change, will meet in Germany to discuss next steps after the historic agreement by 195 countries to curb global climate change to 1.5° Celsius, or 2° at most—an agreement whose only logical conclusion is that the world cannot afford expansion of the fossil fuel industry.

Various players in the financial industry have talked a big game on their commitments to the Paris Agreement. But their business practices prove otherwise.

When President Trump announced he would pull the U.S. out of the Paris Agreement, he drew a line: the Paris Agreement's goal of limiting climate change to 1.5°C on one side, and his administration on the other.

On what side of the line do banks fall? Jamie Dimon, CEO of JPMorgan Chase, said, "I absolutely disagree with the administration on this issue." And yet, JPMorgan Chase has increased its financing for tar sands this year, banking on major companies as they acquire new tar sands assets. Meanwhile, the bank's policy grade comes in at a disappointing D+. JPMorgan Chase's actions declare its support not for the Paris Agreement and the world’s desperate need to stymie climate change, but rather for the Trump administration’s pro-fossil fuel agenda.

Financial institutions have shown that they are able to make significant steps toward aligning their businesses with the goals of the Paris Agreement. Three weeks ago, BNP Paribas published a new policy restricting its financing for tar sands oil, among other extreme fossil fuels, in a move that the Wall Street Journal called “one of the clearest signs yet the banking industry is re-evaluating its relationship with the oil sector."

It’s a relationship that direly needs reevaluation. Banks can't keep funding business as usual expansion of fossil fuels, especially when it comes to the carbon bomb that is the tar sands.

Like it or not, we can’t meet the goals of the Paris Agreement without the financial industry on board, especially as governments like Trump's loosen the reins on the fossil fuel industry. Banks must take the immediate step of exiting the tar sands sector. Independent of governments, these major multinational institutions must say they’re on board with the Paris Agreement—and then prove it.